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Amstrad wins Seagate drive case

Amstrad was awarded #57.5 million in damages against Seagate last week, bringing to an end their five-year disk drive dispute.

The dispute began in 1992 when Amstrad charged Seagate with supplying thousands of faulty Seagate hard drives for use in its PC2386. The drives were supplied in 1989.

Amstrad claimed that, had the Seagate hard drives complied with its requirements, it would have sold 36,558 more machines than it did. Amstrad claimed the faulty drives cost it around #30 million in lost sales of PC2386 and a further #45 million in profits on delayed sales.

The judge ruled that disk drives supplied by Seagate were "unmerchantable" and Amstrad was justified in recovering the costs of replacing the drives, lost profits on delayed sales, loss of sales and other overheads.

The #57.5 million figure does not take into account costs and interest dating back to 1989 which could result in an extra #45 million charge to Seagate. According to a Seagate statement, the award will result in a charge of a like amount to the company's current financial results regardless its decision to consider launching an appeal.

Amstrad's chairman Alan Sugar said: "Nobody will ever know the feeling of devastation suffered by me and the members of my close team when the fruition of our work in establishing from scratch Amstrad as the European leader in PCs was crumbling."

He concluded: "Nobody will ever know where Amstrad would be today if this had not happened. The great efforts of myself and my small team were demolished. The financial award we have received today only goes some way to compensate us."